The government has argued that the firm, which represented thousands of residential school survivors, should have to pay back legal fees because of allegations its billings were inflated.
Lawyers for Canada’s attorney general argued the government would not have entered into an agreement a decade ago to pay the firm $25 million if it had known there were concerns about how much time the company spent working on residential school claims.
Counsel for the law firm has argued the government knew there were concerns about billing and went into negotiations with its eyes wide open, adding that dragging the case into court again was an abuse of process.
In a decision released Wednesday, Madam Justice Jacelyn Ryan-Froslie provided a written decision – with the other two appeal court justices concurring – that concluded the federal government’s position has merit.
Ryan-Froslie allowed the appeal and set aside the decision by the lower-court judge, adding that Merchant Law Group “shall pay to Canada the costs of the within appeal assessed in the usual way.”